State Having Hard Time Attracting Participants to Mortgage Relief Program

By Drew HarwellTampa Bay Times Staff Writer

Published: Saturday, February 2, 2013 at 9:34 a.m.

Last Modified: Saturday, February 2, 2013 at 9:34 a.m.

TAMPA | Even with the sad distinction of the highest foreclosure rate in the country, Florida is still having issues getting millions of dollars in relief into foreclosed homeowners' hands.

Only 55 percent of the 167,000 Floridians who were foreclosed on between 2008 and 2011 have filed claims under a $25 billion settlement reached with big banks, Attorney General Pam Bondi said Friday.

And efforts to gin up more responses, including paying nearly $200,000 for operators to call people directly, have still netted a response rate lower than the national average. The deadline for filing claims has been pushed back to Feb. 15.

"What happens if you've had your house foreclosed on and you get a letter from the bank? You're going to toss it, probably, not thinking it's good news," said Bondi, who spoke alongside Tampa Mayor Bob Buckhorn and St. Petersburg Mayor Bill Foster at a downtown Tampa press event. "It's their money. That's what makes it so frustrating."

About $170 million was set aside for people whose foreclosures included a bank abuse like "robo-signing," in which automated or shoddy paperwork was filed to speed up foreclosures. Checks are expected to be sent out later this year.

The settlement was reached last year between attorney generals and Ally Financial, Bank of America, Citigroup, JPMorgan Chase and Wells Fargo over claims of bank abuse.

Between March and September, banks offered 49,000 Floridians about $3.6 billion in loan modifications, principal reductions and refinancings, according to banks' unconfirmed reports to a settlement monitor.

Most of that money has been spent toward short sales, in which borrowers must leave their home but are forgiven of mortgage debt.

Unresponsive homeowners, attorneys said, could be racked by "borrower fatigue" under an avalanche of bills and bank mailings. Others may simply question the effort. Thousands of Floridians who sought similar relief from the Independent Foreclosure Review were told last month that their submissions would be discarded in favor of an $8.5 billion settlement with flat payouts.

Banks could also share some blame for the tepid response. More than 300 Floridians have filed complaints over issues with the broader settlement, a monitor said in November.

That month, Tampa Heights homeowner Candace Savitz, 59, received a settlement letter from Bank of America and was told she had two weeks to respond. Frantic to make the deadline, she called more than 30 times before she heard an answer and was able to apply.

In the weeks since, though, she said she has been run through a maze of contradictory answers and redundant requests for paperwork, with no loan relief yet to show. She worries now that the bank will tell her she does not qualify or is out of luck.

"They act like they're doing you such a big favor," she said. "It's just a big dog-and-pony show. … I'm not optimistic. Not anymore."

<p>TAMPA | Even with the sad distinction of the highest foreclosure rate in the country, Florida is still having issues getting millions of dollars in relief into foreclosed homeowners' hands.</p><p>Only 55 percent of the 167,000 Floridians who were foreclosed on between 2008 and 2011 have filed claims under a $25 billion settlement reached with big banks, Attorney General Pam Bondi said Friday.</p><p>And efforts to gin up more responses, including paying nearly $200,000 for operators to call people directly, have still netted a response rate lower than the national average. The deadline for filing claims has been pushed back to Feb. 15.</p><p>"What happens if you've had your house foreclosed on and you get a letter from the bank? You're going to toss it, probably, not thinking it's good news," said Bondi, who spoke alongside Tampa Mayor Bob Buckhorn and St. Petersburg Mayor Bill Foster at a downtown Tampa press event. "It's their money. That's what makes it so frustrating."</p><p>About $170 million was set aside for people whose foreclosures included a bank abuse like "robo-signing," in which automated or shoddy paperwork was filed to speed up foreclosures. Checks are expected to be sent out later this year.</p><p>The settlement was reached last year between attorney generals and Ally Financial, Bank of America, Citigroup, JPMorgan Chase and Wells Fargo over claims of bank abuse.</p><p>Between March and September, banks offered 49,000 Floridians about $3.6 billion in loan modifications, principal reductions and refinancings, according to banks' unconfirmed reports to a settlement monitor.</p><p>Most of that money has been spent toward short sales, in which borrowers must leave their home but are forgiven of mortgage debt.</p><p>Unresponsive homeowners, attorneys said, could be racked by "borrower fatigue" under an avalanche of bills and bank mailings. Others may simply question the effort. Thousands of Floridians who sought similar relief from the Independent Foreclosure Review were told last month that their submissions would be discarded in favor of an $8.5 billion settlement with flat payouts.</p><p>Banks could also share some blame for the tepid response. More than 300 Floridians have filed complaints over issues with the broader settlement, a monitor said in November.</p><p>That month, Tampa Heights homeowner Candace Savitz, 59, received a settlement letter from Bank of America and was told she had two weeks to respond. Frantic to make the deadline, she called more than 30 times before she heard an answer and was able to apply.</p><p>In the weeks since, though, she said she has been run through a maze of contradictory answers and redundant requests for paperwork, with no loan relief yet to show. She worries now that the bank will tell her she does not qualify or is out of luck.</p><p>"They act like they're doing you such a big favor," she said. "It's just a big dog-and-pony show. … I'm not optimistic. Not anymore."</p>